Exploring the local impacts of shale gas development Alan Krupnick - - PowerPoint PPT Presentation

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Exploring the local impacts of shale gas development

Alan Krupnick Director, Center for Energy Economics and Policy

RFF Initiative: “Managing the Risks of Shale Gas Development”

• RFF’s Center for Energy Economics and Policy (CEEP)
• An independent, broad assessment of the key

environmental risks associated with the shale gas development process.

Local negative and positive impacts

Negative Externalities

• Traffic (accidents, road damage)
• Noise and light pollution
• Visual impacts
• Air pollution
• Water pollution
• Habitat fragmentation

Positive Externalities

• Those from replacing “dirtier fuels” (but unlikely to be local)

Positive Economic

• Lease payments and royalties
• Tax revenues, fees, etc.
• Economic growth/jobs
• Reduced utility expenses

Negative Economic

• The bust part of the cycle
• Resource curse
• Local infrastructure (water, sewer, roads)

Property Values: A nice (if imperfect) aggregator

Lucija Lucija Jim Hunt Hunt Jim

Policy Context

• Localities have concerns
• Front line for explosion of “industrial activity” in their often rural

communities

• Many of the “external” impacts are obvious, but others are

hidden, scary and/or hard to attribute to oil and gas activity

• Grievances around fiscal treatment. New work by Newell and

Raimi: localities starting from modest infrastructure and without taxing authority could be in for trouble

• These problems boil over into bans and moratoria
• Legal issues in power sharing, takings are far from

settled: Act 13 repeal

• Much debate over net economic benefits

Current projects

• Property value study: all counties in PA
• Truck traffic accidents study: use actual truck routes
• Expert survey follow-up: Deep dive, in concert with EDF

and “States First” on key impact pathways:

• First dive: pits and ponds
• Costs, risks, regulations, best practices
• Feed into States First process
• Western Oil and gas development and Agriculture: The

mediating effect of water markets

• Water withdrawals study: Susquehanna River Basin

Commission permit requests and permit data analysis

Priorities for the Future

• Net benefits to communities of SGD
• Mental health effects of SGD
• Frac Focus coverage
• Habitat fragmentation modeling
• Play out our Natural Gas Initiative

Thank you! krupnick@rff.org

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Risk Matrix